Russia overtakes Saudi Arabia to become India’s second-biggest crude supplier

By: Anshul Vipat

India's oil imports from Russia surged to a record of around 950,000 barrels per day (bpd) in June, accounting for nearly a fifth of overall imports by the world's third largest oil consumer

India's oil imports from Russia surged to a record of around 950,000 barrels per day (bpd) in June, accounting for nearly a fifth of overall imports by the world's third largest oil consumer, data provided by Bloomberg revealed. In May, India imported 819,000 barrels per day (bpd), up from 277,000 bpd in April and 33,000 bpd a year ago. The higher oil intake from Russia raised its share of India's overall imports to 19.8 percent from 16.4 percent in May. On the other hand, those from Iraq and Saudi Arabia dropped by 10.5 percent and 13.5 percent, respectively, dragging the share of the Middle East to 56.5 percent from 59.3 percent, the data showed. OPEC's share of India's oil imports has been declining since March. Although, Iraq continues to remain India's biggest oil supplier.

Indian refiners have been snapping up Russian oil sold at hefty discounts to Brent and Middle East staples after some Western companies and countries shunned purchases from Moscow following its invasion of Ukraine on February 24. Russian barrels were cheaper than Saudi crude during April through June, with the discount widening to almost $19 a barrel in May. Oil from the OPEC producer was around $9 a barrel higher than Russian barrels in May. The discounted oil has proved to be a blessing on our stressed import bills. We continue to import 85 percent of our oil needs, and the cheap supplies provide some economic relief as the country faces high inflation and a record trade gap.

Last year, Russia was far from the top suppliers of the subcontinent: it ranked ninth. Now, thanks to the cheaper Russian crude, things look very different. India putting its energy security first also speaks a lot about its growing geopolitical influence. New Delhi has stayed away from out rightly condemning Russia despite piling pressure from the US and its allies. By doing this, India wants to avoid repeating what it sees as the mistakes of the past: abiding by sanctions on Iran and winding down oil imports, only to see its main regional rival China continue unpunished and benefit economically.